CEO first to feel the axe at CBA

THE Commonwealth Bank board is under pressure to find an outsider who can clean up its culture after the revelation chief executive Ian Narev will exit within 11 months.

Mr Narev has become a casualty of the money laundering scandal unfolding at the bank, according to industry experts, who believe it will look for a successor externally.

The bank’s board, chaired by Catherine Livingstone, yesterday said that Mr Narev, 50, would “retire” by the end of the financial year.

It revealed the outgoing chief had received a pay and perks package worth $5.5 million for the past financial year, less than half the $12.3 million package he received in 2015-16.

Ms Livingstone rejected speculation that the group had hastened the timeline to announce Mr Narev’s departure in the wake of the scandal.

The decision to flag his exit had been “carefully considered”, she said.

The board had “formed the view, in conjunction with Ian, that if we provided this statement and clarity as to the timing, then it would enable Ian and the team to focus back on the running of the bank”.

But major investors in the CBA said they were unimpressed with the move.

The bank was “throwing the CEO overboard” but not “moving to reform the cul- ture”, according to one institutional investor who declined to be named.

That investor, who met bank executives last week, said it would need an external hire to clean up its culture after a series of scandals, and “it would be hard to see an internal candidate” succeeding.

“Which internal candidate would not have a black mark against them at present? They were part of the same culture,” the source said.

The bank’s annual report reveals total remuneration of the 12-person executive team dropped to $27.5 million in the year to June from $51 million the previous year.

Ms Livingstone rejected concerns that the announcement would effectively render Mr Narev — who has lifted the CBA’s earnings to record levels every year during his tenure — a “lame duck”.

Mr Narev has been CEO for five years and eight months.